America's Health Care Stupidity

Health care reform in the U.S. appears to be more than halfway home and even a watered-down version will boost its beleaguered economy.

Americans this weekend began crossing their biggest psychological Rubicon: opposition to universal health care. Once on the other side, they will eliminate the single biggest fear among the population, will remove a major burden for businesses and, by so doing, benefit the economy by loosening consumer spending.

Universal health care is not just smart and fair social policy; it is also smart economic policy.

It works this way: If a worker in Canada or Europe or Japan loses his or her job, it's a psychological and income blow. But if an American worker loses his or her job, the family faces financial ruin if sickness strikes any member because they are without health care coverage. Bridge coverage is available but unaffordable for anyone but the wealthy.

Worse yet, if a major illness is diagnosed during unemployment, a worker becomes unemployable, bringing about a life sentence of poverty.

Economic impact on poor health care

Little wonder, then, that consumer spending has ground to a halt in the United States, making the economic meltdown that much harder to combat or ever solve.

On Saturday, the House of Representatives squeaked through its version, leading Republican detractors to warn that the Senate will kill the initiative.

Not so.

The momentum is there and the Senate may water down health care reform but it will pass some version. By the next election, this will become one of the most popular and beloved policies since social security and medicare. It will have the added benefit of allowing governments to rein in and tackle costs.

The economic case for health care reform is compelling:

1. The U.S. spent 16.2% of its GDP on health care plus up to 3% more on litigation concerning medical bills while other countries spend 10% and nothing on litigation because bills are paid by everyone.

2. People with serious illnesses are uninsurable and are stuck in jobs they cannot leave or remain unemployed because they are unemployable.

3. Tens of millions of uninsured people in the U.S. end up with health problems that become a drain on the society and economy in the long run.

4. Doctor, nursing, hospital and drug costs are out of control in the U.S. because of litigation and greed. American doctors over-service those with health insurance, and patients over-demand. Over-doctoring is commonplace.

5. Detroit's three automobile companies went bust in large measure due to "legacy" or gold-plated health care promises of Canadian-type coverage at America's excessive prices. This burden was not unique to the auto sector and has driven many jobs offshore in manufacturing.

These are the reasons why Republicans and the Senate should, and I believe, will, pass some form of health care reform. A Canadian or European-style health care tab would eventually shave 5% in costs off the U.S. economy of US$13.8 trillion and another 3% by eliminating litigious ambulance chasers.

This is not pie in the sky. Governments outside the U.S. deliver medical care better than does America's mixed public-private sector system. The proof exists all over the world except in the minds of partisan ignoramuses defending the indefensible.